THE POLITICS BEHIND PERFORMANCE: HOW SHADOW STRATEGIES DRIVE ORGANIZATIONAL OUTCOMES IN EMERGING MARKETS

Abstract

This study examines how informal political behaviors—termed shadow strategies— affect organizational performance in emerging Southeast Asian markets characterized by institutional voids and regulatory ambiguity. Using survey data from 234 senior- and mid-level managers across Indonesia, Malaysia, Singapore, and Thailand, we employed Partial Least Squares Structural Equation Modeling (PLS-SEM) to analyze the direct, indirect, and moderating effects of Organizational Political Work Intensity (OPWI), Leadership Political Engagement (LPE), and Non-Market Strategy Orientation (NMSO). The results demonstrate that LPE and NMSO significantly enhance organizational performance, while OPWI has no substantial impact. Moreover, Ethical Identity Salience (EIS) and Strategic Clarity (SC) amplify the positive role of political strategies, whereas Organizational Culture of Politics (OCP) plays a dual role, either reinforcing or undermining outcomes depending on ethical alignment. Theoretically, the study integrates political strategy with ethical and strategic constructs, contributing to the literature on strategic management and non-market strategy in volatile contexts. Practically, it offers insights for leaders on balancing political engagement with ethics and strategic clarity to achieve sustainable performance in politically charged environments.